Bought the monster cable PIP kit. Has anyone setup PIP with premium digital cable set top boxes? I have a Motorola digital cable box, from ATT. Several people have stated I may need two digital boxes, and a A/V switch. If this is the only way to set this up? Would anyone have a cable diagram or first hand knowledge as to how to set this up?

While I don't have a digital cable set top box. I think I can help a little. First off you would only need an additional digital cable set top box if you wanted to have the digital or scrambled channels show up in the PIP. If you can live with basic cable showing up in the PIP then I seem to recall the Motorola digital cable box having a loop through so you can have PIP. Since I don't have one I won't be really good at detailing how you wire it, but If you'll give me more details about how you have it connected to your TV, and what the three coax connections are labeled as on the Motorola digital cable box I'll give it a shot. Also can you give me more information about the monster cable PIP kit. I'm not familiar with it so I don't know what's in it.

You shouldn't need 2 cable boxes. My WEGA only uses one incoming signal from the cable and PIP works fine. No looping, it's done inside the TV for you already.
As for HTIB: Personally, I don't like the idea of HTiB, but you have to start somewhere. It's an OK way to start, and I feel the Sony's are the best deal with some of the better subs for an HTiB.
An HTiB should come with everything you need to hook it up, including basic cables (in the case of most Sony products) as well as all the instructions. Not a whole lot to it either, since the DVD is integrated with the receiver/amp. All you should need to hook up is the speakers and connect the receiver/DVD to the TV.
A warning about that particular TV, a friend just bought one and it died within days. It was replaced with another, which has a distorted image. See if you can check it out before buying it.
BTW: Welcome to the board.